Car Import Shake-Up: Bans, Duties and New Rules Explained
Pakistan’s vehicle import policy Pakistan has changed a lot in 2025 and now in 2026. These updates are part of the new import policy of Pakistan 2026, which affects overseas Pakistanis, car dealers, and local buyers. Under the latest auto import policy Pakistan, the government has allowed commercial imports of used cars up to five years old, but at the same time it has banned personal baggage vehicle imports. This new car import policy Pakistan is linked with IMF agreements and the National Tariff Policy, so it is important for anyone who wants to import or buy an imported vehicle. In this guide, we clearly explain the Pakistan used car import policy, the latest tax on imported car in Pakistan, and how the new pakistan import policy for used cars will work in 2026.
Why This Policy Matters
Pakistan’s vehicle import policy for 2026 is one of the biggest auto reforms in years. It directly affects overseas Pakistanis, local buyers, and the auto market.
The changes are linked to Pakistan’s IMF trade liberalization commitments and the National Tariff Policy 2025-30.
In simple terms:
- More used cars can be imported commercially
- The personal baggage scheme is banned
- Overseas Pakistanis must follow stricter ToR and Gift rules
- Duties will reduce gradually until 2030
Official Policy Sources:
- Ministry of Commerce SRO updates: commerce.gov.pk/sros
- Import Policy Order (IPO) 2022: Official IPO Document
- National Tariff Policy 2025-30: Official Tariff Policy
Policy Timeline: What Changed and When
| Date | Government Update |
|---|---|
| July 1, 2025 | National Tariff Policy 2025-30 implemented |
| Sept 30, 2025 | SRO 1895 allows commercial import of used cars under 5 years old |
| Dec 16, 2025 | SRO 2443 introduces mandatory pre-shipment inspection agencies |
| Jan 7, 2026 | Cabinet approves new Transfer of Residence (ToR) rules |
| Jan 15, 2026 | SRO 61 bans personal baggage vehicle imports |
| Feb 1, 2026 | Pre-shipment inspections become compulsory |
| June 30, 2026 | 5-year age cap ends for commercial imports |
| July 2026 onward | Age limit rises to 7 years |
Key takeaway: Pakistan is opening imports but tightening regulation and safety standards.
What Commercial Importers Can Now Import
Pakistan now permits commercial import of used vehicles under:
- PCT 8702 (buses, vans)
- PCT 8703 (cars)
- PCT 8704 (pick-ups)
- PCT 8711 (motorcycles)
Age Limit:
- Up to 5 years old until June 2026
- Up to 7 years old from July 2026
Requirements:
- Must meet Engineering Development Board (EDB) safety & emission standards
- Must pass Pre-Shipment Inspection (PSI)
Official EDB guidelines: edb.gov.pk/AutoIndustry
Transfer of Residence (ToR) and Gift Scheme — New Rules
Pakistan continues to allow imports for overseas Pakistanis, but only through:
Transfer of Residence (ToR)
To qualify:
- Must have stayed abroad for 850 days in the last 3 years
- Vehicle must be imported from the same country of residence
- Car cannot be sold for one year
- Only one vehicle allowed every 3 years
Gift Scheme
- Allowed for eligible overseas Pakistanis
- Vehicle must meet commercial standards
- Same resale restriction applies
Policy notification: Ministry of Commerce, January 2026
For more information on recent automotive regulations, check out our coverage of Honda Civic 2026 safety features and M-Tag registration processes.
Why Personal Baggage Imports Are No Longer Allowed
Pakistan has completely banned vehicle imports under the personal baggage scheme.
This was done through SRO 61(I)/2026 on January 15, 2026.
Reason for ban:
- Prevent misuse and tax evasion
- Ensure all imported vehicles meet commercial safety and quality standards
What the National Tariff Policy 2025-30 Means
The National Tariff Policy (NTP) is gradually reducing import protections.
Major changes:
- Customs duty slabs will reduce to 15% by 2030
- Regulatory duties on used cars will be removed in phases
- Additional customs duties will be eliminated within 4 years
This is meant to make Pakistan’s auto sector more competitive and consumer-friendly. Learn more about how these changes affect electric vs petrol vs hybrid cars in Pakistan.
Taxes on Imported Vehicles in Pakistan
Imported cars remain heavily taxed.
| Tax Type | Typical Rate |
|---|---|
| Customs Duty | 50% – 75% |
| Sales Tax | 18% |
| Additional Customs Duty | 6% – 10% |
| Income Tax | 6% – 12% |
| Regulatory Duty (Used Cars) | 40% in FY26 |
Regulatory Duty Reduction Plan:
| Fiscal Year | RD Rate |
|---|---|
| FY2026 | 40% |
| FY2027 | 30% |
| FY2028 | 20% |
| FY2029 | 10% |
| FY2030 | 0% |
Official FBR duty calculator: fbr.gov.pk/import-calculator
Example: Cost of Importing a 1000cc Used Car
Assume:
- CIF Value: PKR 2,000,000
- Depreciation: 36% for a 3-year-old vehicle
| Tax Component | Amount |
|---|---|
| Customs Duty | 832,000 |
| Sales Tax | 385,040 |
| Income Tax | 211,200 |
| Regulatory Duty | 512,000 |
| Total Estimated Taxes | ~1.94 Million PKR |
This estimate may change with FBR exchange rate updates.
Depreciation Formula Used in Pakistan
Pakistan applies 1% depreciation per month on CIF value.
| Age | Depreciation |
|---|---|
| 1 Year | 12% |
| 3 Years | 36% |
| 5 Years | 60% |
Depreciation lowers the tax base, but total duties still remain high.
If you’re interested in newer models with advanced features, explore our guides on Jaecoo J5 Hybrid pricing, Avatr 11 specifications, and Kia prices for 2025.
How This Policy Affects Pakistanis
Overseas Pakistanis
- Must meet new ToR or Gift eligibility
- Cannot import through baggage
- Must ensure vehicles meet EDB standards
Local Buyers
- More used cars will enter the market
- Prices may stabilize over time
- Quality control will improve
Car Dealers
- Can import more vehicles commercially
- Must follow strict inspections
- Face higher compliance costs
What Happens Next?
- June 2026: Existing 5-year commercial import window ends
- July 2026: Age cap rises to 7 years
- By 2030: Regulatory duties and additional customs duties will be eliminated
Pakistan is shifting toward a more open and standardized auto import policy.
Frequently Asked Questions
Which vehicles are allowed under Pakistan used car import policy?
Cars, vans, pick-ups, and motorcycles under 5 years old until June 2026 and under 7 years old afterward.
Is the personal baggage vehicle import policy still valid?
No. It was officially banned in January 2026.
How much duty applies on used car imports in Pakistan?
A temporary 40% regulatory duty applies in FY2026, reducing yearly to zero by FY2030.
What are the requirements for Transfer of Residence imports?
You must stay abroad for 850 days in the last 3 years and import the vehicle from your country of residence.
Where can I check official car import duties in Pakistan?
Use the FBR Import Duty Calculator on the official FBR website.
What is the depreciation formula for imported vehicles in Pakistan?
Pakistan applies 1% depreciation per month on CIF value. For example, a 1-year-old car has 12% depreciation, a 3-year-old has 36%, and a 5-year-old has 60% depreciation.
Final Word
Pakistan’s car import policy for 2026 reflects both trade liberalization and tighter regulation.
The government is gradually reducing duties, but quality, safety, and eligibility rules are now much stricter.
For buyers, the key is simple:
- Verify eligibility
- Follow EDB standards
- Use the FBR calculator for accurate tax estimates
This policy aims to balance consumer access, industry protection, and economic reform.
Stay updated through the Ministry of Commerce’s official SRO portal.
